---
title: "NBU Raises Discount Rate to 16.5%: Pyshnyy Cites Escalating Inflationary Pressure"
description: "The National Bank of Ukraine has raised its discount rate from 16.0% to 16.5% amid accelerating inflation, which reached 10% year-on-year in September. The forecast for 2026 has been revised to 12.5%."
date: 2026-10-29T12:25:01.091Z
lang: en
url: https://xab.info/en/posts/nbu-raises-discount-rate-to-16-5
tags: [nbu, policy-rate, inflation, ukraine-economy, hryvnia]
author: "Darya Fomina, Andrey Kosynko"
publisher: "XAB.info"
---

# NBU Raises Discount Rate to 16.5%: Pyshnyy Cites Escalating Inflationary Pressure

![National Bank of Ukraine Governor Andriy Pyshnyy speaking at a briefing on the discount rate](https://xab.info/media/2026/10/29/nbu-povyshil-uchetnuyu-stavku-do-16-5/nbu-povyshil-uchetnuyu-stavku-do-16-5-1.webp)

## Key Points

- The NBU raised the discount rate from 16.0% to 16.5% per annum
- Annual inflation in September reached 10%, the 2026 forecast was revised to 12.5%
- The military component added 0.7% to inflation, according to the NBU Governor
- The rate was held at 15% until the end of July 2026, after which a hiking cycle began

The National Bank of Ukraine has decided to raise its discount rate from 16.0% to 16.5% per annum. This was announced by the Governor of the regulator, Andriy Pyshnyy, during a monetary briefing, according to RBC-Ukraine. According to him, this step is driven by "a significant increase in price pressure and the deterioration of inflation expectations." The NBU emphasizes that the increase should support the attractiveness of hryvnia assets and the stability of the foreign exchange market.

### Decision and Its Rationale

"The National Bank has raised the discount rate to 16.5%... taking into account a substantial increase in price pressure and deteriorating inflation expectations," Pyshnyy stated. The regulator links the decision to the need to keep inflation expectations under control and return price dynamics to a trajectory of steady decline. As the NBU notes, a tighter monetary policy makes hryvnia deposits and domestic government bonds more attractive, which limits pressure on the currency market.

### Inflation and the Military Component

The main reason for tightening policy was high inflation, which intensified against the backdrop of Russian attacks on business, logistics, and critical infrastructure. In September, annual inflation rose to 10% year-on-year, and according to NBU estimates, similar trends persisted in October. Pyshnyy specifically highlighted the military factor: "Shelling added 0.7% to inflation," he noted regarding the size of the military component in price pressure.

### Forecasts for 2026–2027

The National Bank has revised its inflation forecast for the end of 2026 upward to 12.5% year-on-year. The regulator expects the indicator to decline only in 2027, down to 7.3%, when the impact of high global oil and fuel prices subsides. Thus, according to NBU calculations, the peak of inflationary pressure will occur at the end of the current year, while a gradual slowdown will begin next year.

### Rate Hike Cycle

The current decision continues the tightening cycle that began in the summer. The National Bank kept the discount rate at 15% from the beginning of 2026 until July 31, after which it raised it to 15.5% in late July, and to 16% on September 18. Thus, within a few months, the regulator has raised the rate twice, and the current step to 16.5% is a continuation of this trajectory amid persisting price pressure.

### Banking Sector Expectations

In the banking sector, the rate hike is considered necessary to curb inflation and maintain the attractiveness of hryvnia deposits. Serhiy Mamedov, Vice President of the Association of Ukrainian Banks and Chairman of the Management Board of Globus Bank, explained that the increase in the discount rate also performs the function of situational easing of demand for foreign currency. According to him, after August, when annual inflation was 8.1%, new factors accelerating it appeared by autumn, including attacks on energy, logistics, and corporate production chains.

## Fact-Check & Sources

- [НБУ повысил учетную ставку: какое новое значение и какие риски его обусловили](https://www.rbc.ua/ukr/news/nbu-pidvishchiv-oblikovu-stavku-ke-nove-znachennya-1793276109.html) - Primary source: hike to 16.5%, Pyshnyy's quote, 10% inflation in September, 12.5% forecast for 2026 and 7.3% for 2027, military component 0.7%, rate chronology.
- [НБУ повысил учетную ставку](https://korrespondent.net/business/economics/4912544-nbu-povysyl-uchetnuui-stavku) - Context of the previous step to 16%: inflation at 8.1% in August, connection with rising fuel prices and administrative tariffs following infrastructure strikes.
- [НБУ повысил учетную ставку до 16%](https://delo.ua/ru/news/nbu-povysil-ucetnuyu-stavku-do-16-472694/) - Context of the September 17 decision: attractiveness of hryvnia assets, banking response, NBU's readiness to apply additional measures if risks escalate.
- [НБУ повысил учетную ставку: банкир объяснил, как это отразится на кошельках украинцев](https://www.unian.net/economics/finance/povyshenie-uchetnoy-stavki-nbu-chto-budet-s-kreditami-i-depozitami-ukraincev-13456287.html) - Подтверждено по источнику unian.net

## FAQ

### By how much did the NBU raise the discount rate?

From 16.0% to 16.5% per annum.

### What is the inflation forecast for 2026?

According to NBU estimates, inflation by the end of 2026 could reach 12.5% year-on-year; a decrease is expected in 2027 to 7.3%.

### What share of inflation does the military component account for?

According to NBU Governor Andriy Pyshnyy, shelling added 0.7% to inflation.

### When did the rate hike cycle begin?

The rate was held at 15% until July 31, 2026, after which it was raised to 15.5% in late July, to 16% on September 18, and to 16.5% with the current decision.